Everything You Need To Know About Order Fulfillment

As a retailer, your main purpose is to grow your company, which can be accomplished by accurate, and on-time delivery of the products. Keeping this in mind, businesses should always strive for the best order fulfillment strategies.

What Is Order Fulfillment?

Order fulfillment is a process of receiving goods, handling them and delivering orders to the customers. It can be understood as a process of stock-piling inventory.

Nowadays, customers demand an early and on-time shipment, preferably within 2 days. Offering customers mix and match shipping options that best suit their needs will improve the company’s business. Delivery services are quite important for customer satisfaction.

By improving your order fulfillment process, you can

  • Reduce functioning costs
  • Enhance customer service
  • Globally develop your customer base
  • Focus on selling/ sales
  • Lower your cost for shipping

Steps In The Order Fulfillment Process

The process starts from a customer placing order and ends on receiving them. The steps involved are:

  • Receiving inventory
  • Storage inventory
  • Processing orders
  • Packing the products
  • Shipping orders
  • Handling returns

Types Of Order Fulfillment

Order fulfilment is the main component of the supply chain process and businesses as a whole. There are four types of order fulfilment process.

In-House Order Fulfillment 

Here companies let their employees manage the order fulfilment process at a company-controlled location. This method is mostly used by established companies and home-based start-ups. As the home-based starts-ups outgrow, they switch to out-sourced fulfillment processes.

in-house employee
In-house employees handle order fulfillment process

Out-Sourced Order Fulfillment

This method of order fulfilment is handled by third-party logistics/ companies. Companies that don’t have sufficient storage space will opt for this method, as third-party logistics can store them in a warehouse. Third-party logistics handle all the procedures, from receiving inventory from retailers to delivering products to the customer.

third-company warehouse
Third-party company offers warehouse

Drop-Shipping

This type is quite similar to the out-sourced method when the retailer doesn’t store the products. However, when the item is sold, the retailer purchases it from a third-party supplier. The supplier will then handle all the orders and ship them to the customer. Start-up retailers and newbies often use this method for eCommerce.

Hybrid Fulfillment

This method is commonly used by companies due to more flexibility and rapid actions. This is a combination of the above-mentioned order fulfilments. An example of this is a company that processes some in-house orders, such as custom items or items that must be assembled before shipping, but still use drop-shipping services for non-custom items.

Final Tips

This process is the key to attract customers and maintain your competitive edge. Choose what works best for you, by using data and technological tools to drive your decisions to maintain demands and inventory levels. 

choose what works best for order fulfillment process
Choose what works best for your order fulfillment process

Communicate clearly and effectively during the refund and return processes. Do not be intimidated by the technology for automation. It increases accuracy, guiding warehouse associates to work faster while reducing errors.

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POS system can help in the order fulfillment process for excellent delivery service. Using a POS system has several benefits:

  • Create an omnichannel shopping experience (consumer app), while ensuring customers get the product they want.
  • Allow click-and-collect.
  • Assist staff with all tools and assistance, to complete their tasks efficiently.
  • Provide efficient inventory management.
  • Help in the expansion of e-commerce offerings.
  • Create a well-functioning commercial website.

Are you growing your retail business? ConnectPOS offers technological solutions, you can contact us here.

About the Author

Jacey V.

Jacey V.

Jacey V. is a content marketing intern at ConnectPOS - a leading point of sale provider. Being curious about the growth of ecommerce in recent years, she has closely followed the latest technological developments and how they have facilitated businesses to grow.

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